Ark Invest scoops up $18 million in Circle shares as stock dips 41% over past month

Cathie Wood's investment firm Ark Invest snapped up more shares of Circle Internet Group on Wednesday as the USDC stablecoin issuer's stock slipped further.

The firm's latest trading disclosure shows that Ark bought a total of 287,609 shares of Circle across three of its exchange-traded funds — ARKK, ARKW, and ARKF. At today's closing price of $61.95, Ark Invest added roughly $17.8 million worth of the stock.

Circle (CRCL) closed down 1.1% today after it plunged by nearly 18% during Tuesday's trading session, which marked its worst single-day decline in recent months. It is down 41% over the past month.

The sharp fall was widely attributed to Open Standard announcing Open USD (OUSD), a new stablecoin backed by more than 140 companies including Visa, Stripe, Mastercard, BlackRock and Coinbase.

Investors assessed potential competitive threats to Circle's USDC, and Coinbase's involvement in the new stablecoin project, as the exchange earns roughly 50% of USDC's reserve income under its distribution agreement with Circle.

Expand Chart

No immediate threat

While CRCL took a heavy hit and extended its decline today, market analysts argued that OUSD does not pose an immediate threat to Circle. Earlier on Wednesday, Bernstein analysts reiterated their Outperform rating on Circle and maintained a $190 price target, saying that it is unlikely that Coinbase will shift away from Circle. 

Analysts at William Blair also said on Tuesday that the sell-off was an overreaction, arguing that Circle's first-mover advantage, liquidity and payments infrastructure leave it well positioned despite competition from a high-profile rival like OUSD.

Meanwhile, Ark also scooped up 27,740 shares of crypto exchange Bullish, worth $699,880. Bullish (BLSH) jumped 7.7% on Wednesday to close at $25.23.